A deposit can separate window shoppers from serious buyers
Franchise fee deposits can be a useful tool in filtering out prospective franchisees from those who are not ready to commit but be sure to follow the applicable law in using this.
View ArticleApplication process should weed out less serious buyers
A franchise application should ask for past business experience as well as financial wherewithal.
View ArticleTechnical requirements are as important as content of franchise agreeement
There is more to a franchise disclosure document than its content. Failing to comply with technical requirements can invalidate the document.
View ArticleFailing to provide a valid disclosure document can be costly for franchisors
In some provinces, the disclosure document is a type of prospectus franchisees can rely on in making informed investment decisions about entering into the franchise system. So not providing one on time...
View ArticleA primer on franchise disclosure documents
Exactly what is a franchise disclosure document and what should a franchise expect to see in it. Franchise lawyer Chad Finkelstein explains the ins and outs of this document over the next few weeks.
View ArticleWhat's not in a franchise disclosure document
Disclosure documents can be anywhere from 20 to 200 pages but there are still things it does not contain about the franchise.
View ArticleManitoba introduces franchise law
Effective Oct. 1, 2012, Manitoba will join Ontario, Alberta, Prince Edward Island and New Brunswick as the provinces in Canada to have enacted franchise legislation
View ArticleFranchise relationships come with their share of obstacles
In licensing another individual the right to operate a business under its brand, a franchisor is entrusting that individual with maintaining the same quality of products and service which the brand was...
View ArticleOpen lines of communication helped Tim Hortons' stay out of hot water
Franchisees have come to expect franchisors will keep them informed, but good communication is a two-way street that is vital to the relationship.
View ArticleManitoba's franchise legislation coming into force
Manitoba will become the fifth Canadian province to implement franchise legislation when The Franchises Act and Franchises Regulation come into force on Oct. 1
View ArticleCourts don't condone royalty strikes by franchisees
A reader recently asked whether franchisees can withhold royalty payments if they're unhappy with their franchisor. The answer is no. Here's why:
View ArticleA franchisee's exclusive territory usually comes with conditions
One of the most important discussions for franchisees and franchisors to have is about the territory and conditions.
View ArticleTurnkey construction may be one benefit of buying a franchise
One key area where the franchisor’s support is vital (and sometimes controversial) is construction
View ArticleWhen is a new franchise location too close?
Even if a franchisee does not have specific territorial right, those negatively affected by a new franchise location are not without remedy.
View ArticleYour trademark is what interests franchisees, so get it right
The word “advantage” may be understating the critical importance of trademark protection when you are licensing intellectual property to franchisees.
View ArticleAre you an accidental franchise?
Most people think they know a franchise when they see one, be it Burger King, Tim Horton’s, or Baskin Robbins. If they think a little harder, they also may come to the conclusion Mr. Lube, the Bell...
View ArticleRescission remedy cases aren't a slam dunk
Where significant facts are in dispute, courts are unlikely to decide franchise disclosure issues without a trial.
View ArticleWhose customers are they?
When you buy the right to set up a franchise you forego control over some aspects of the business. One of those elements is the ability to own your customer lists.
View ArticleWhat do you mean there's no trademark?
Make sure that the thing you came aboard for, the franchise brand and reputation, is actually registered, otherwise you need to take steps to protect yourself.
View ArticleThink outside the box for new franchise opportunities
While most franchise opportunities are found in malls, strip plazas, power centres or storefronts there are plenty of other unique locations where a franchise could be opened.
View ArticleSite-specific disclosure documents are a win-win for franchisors and franchisees
For a disclosure document to be legally compliant, and fully inform franchisees of what they are about to get into, it must include certain elements of the deal that are specific to that franchisee.
View ArticleEven a profitable franchisee can rescind
If a franchisor failed to disclose properly and the franchisee rescinded on time, the franchisor has to compensate the franchisee even if it ends up with a windfall.
View ArticleFranchisees' social media efforts may help you rise to the top
While franchisors can incur damages from franchisees' incorrect use of social media, it's still in their best interest to allow franchisees to have local Facebook pages and Twitter accounts. Here's why.
View ArticleThe costs of franchising a U.S. brand in Canada rests with the franchisee
It can be exciting to acquire the Canadian rights to a U.S. franchise, especially one we all eat at or shop at whenever we travel south of the border. But what does this entail for the franchisee?
View ArticleAppellate court removes muzzle on franchisees opposed to Pet Valu case
The Ontario Court of Appeal allows a mass exodus of Pet Valu franchisees from a class action that accuses the corporate franchisor of failing to pass on supplier discounts to franchisees
View ArticleFranchisees usually have no recourse, or say, when franchisor sells business
The recent announcement of the sale of Extreme Brandz to MTY Food Group may or may not please Extreme Brandz's franchisees. Either way, it is of no consequence because franchise agreements almost...
View ArticleEven new franchisees should plan for the day they want out
It’s never too early for franchisors and franchisees to consider how things will be handled the day when, for whatever reason, the franchisee has found a buyer for its business
View Article'No purchase necessary' and other contest rules your franchise needs to know
Contests are a great way to increase your business, but under the Criminal Code of Canada, a gambling operation is prohibited unless it is conducted by a provincial government, so legal contest...
View ArticleTis the season for gift cards but know the rules
Retailers are expected to know the laws that exist to protect consumers — and these vary from province to province
View ArticleFranchise agreements don't last forever so be sure to negotiate a pre-nup
Signing a franchise agreement is an energizing moment, and hopefully the start of a productive and successful business relationship. But it’s never too early to begin thinking about the end.
View ArticleNo amount of legal advice replaces direct communication, but it's still an...
Franchise law exists to ensure franchisees have certain rights and remedies in the face of unequal bargaining power on the franchisor’s end, but in the long run signing a franchise agreement comes down...
View ArticleFranchises need to prepare for new healthy eating regulations
Last month, the Ontario Minister of Health sponsored a bill entitled Making Healthier Choices Act, 2014, which, if passed, would require restaurant chains in Ontario with 20 or more locations to...
View ArticleIs your franchise really ready to go global?
Just because someone in a market you weren’t looking at calls because they like what you do doesn’t mean it’s time to start licensing your brand to that person.
View ArticleWhat does the foreign worker ban mean for your franchise?
Now might be a good time, for franchisors to audit franchisees’ hiring practices before their brand name appears in headlines across the country
View ArticleHere's why enacting franchise law in British Columbia is a welcome initiative
If enacted as drafted, B.C.’s franchise law will contain a disclosure document requirement, with extremely similar, if not identical, content, preparation and delivery requirements as in the other...
View ArticleEvery sale of a franchised business requires a franchisor's approval
Faced with many potential obstacles inherent in the sale of a business, buyers and sellers must remember that above all else no transaction can be consummated without the blessing of the franchisor....
View ArticleWhat you should know about disclosure obligations when buying or selling a...
The best practice for a franchisor in discussions to be acquired might be to simply avoid all new franchise sales efforts to avoid legal complications
View ArticleHow to protect your franchise brand without being heavy-handed
Every franchise agreement states that the franchise rights can be terminated if a franchisee runs afoul of the brand's standards. But just because the agreement says it’s so, doesn't necessarily mean...
View ArticleNew menu labelling laws will have a wide impact on the franchise industry
While the goals are laudable, compliance with and enforcement of these laws may prove costly for restaurant operators across Canada and the United States
View ArticleWhat happens if your franchisor goes bankrupt?
When a franchisor declares bankruptcy, the franchisees will likely not find comfort in the franchise agreement or franchise law, but still they have some options
View ArticleThere's a reason negotiating territory in a franchise agreement remains...
While exclusive territories makes sense for some franchises, for others they may be more of a theoretical concession rather than one that provides any actual protection
View ArticleVern Krishna: Family businesses should heed the rules on associated corporations
If the Income Tax Act offers generous advantages for small, family owned businesses, why not divide your medium-sized business into three small ones? Vern Krishna explains why this won't work.
View ArticleDon't let flattery guide your decision to set up a franchise outside of Canada
There are plenty of examples that serve as the exception to the rule, but on the whole an aggressive international expansion of a franchise system is a risky proposition
View ArticleBafflement behind a policy meant to help Ontarians make healthier eating choices
The huge cost to restaurant and food services chains to comply with Ontario's proposed Healthy Menu Choices Act are not the only frustrations being faced.
View Article'Joint-employer' status could rattle franchise industry: 'It will be a...
An emerging concept called 'Joint employer status' could be a game changer for the Canadian franchise industry
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